Due to morbidity and limited amounts of material, alternatives to autologous grafts for bone repair are desirable. Cells within the bone marrow are known to possess bone regenerative capacity, but they are limited in number. Increasing these osteoprogenitor cell populations through the use of ex vivo expansion technologies and combining these cells with a matrix material may significantly increase the amount and rate of new bone formation, and replace the need for autologous grafts. Phase I studies identified expansion variables for osteoprogenitor cell expansion and showed that this process can be scaled up into the automated clinical-scale cell culture system, the AastromReplicell(r) Cell Production System (ARS). In Aim 1 of the Phase II studies, optimization of the osteoprogenitor expansion process will continue. Optimization will be measured by not only biological performance in vitro and in vivo, but also the ease of commercialization of the expansion process. Specifically, the role of other cell populations in osteoprogenitor cell expansion and function will be determined, the minimal requirements for including exogenous factors in cultures will be identified, inoculation densities and maximized feeding schedules will be determined to support expansion from small volume bone marrow aspirates, the potential for expansion in an animal serum-free environment will be examined. In Aim 2, the angiogenic potential of these same cell products will be measured in vitro by colony assay and tube formation assays, as blood vessel formation is important for optimal bone regeneration. Aim 3 will validate optimal expansion processes in the ARS and evaluate bone and vascular regeneration in vivo in an ectopic mouse model. Aim 4 will include a Phase l/ll clinical trial using the selected cell product in combination with matrix material to treat tibial non-union fractures. Successful completion of these studies will lead to the development of a cell therapy kit that can be used for bone regeneration.